Letter from Sir John Kerr

LETTER FROM SIR JOHN KERR DATED 6 NOVEMBER 1975

In this letter, Sir John rushes off a letter to advise on the latest developments. He has been having meetings with a number of people, including the Prime Minister and Leader of the Opposition. Very telling is this sentence “He [Mr Whitlam] said that he would never recommend an election for the House of Representatives until he himself was ready to do so and certainly would not do it at the behest of Mr Fraser or the Senate. He later said that the only way in which an election for the House could occur would be if I dismissed him.

PERSONAL AND CONFIDENTIAL

Government House,
Canberra. 2600.

6 November 1975.

My Dear Private Secretary

It has been a busy week during which I have had some discussions with the Leaders here.

First, on Monday last (3 November) Mr Fraser sought leave to see me. After mentioning this to the Prime Minister I agreed to let him do so. It turned out that the purpose of his call was to say that he and his colleagues had come to the conclusion that they would be prepared to agree to a scheme under which the House of Representatives would go to an election at the same time as any Senate election was called. This would mean that whether a Half Senate election was called early or late they would retreat from their demand for an immediate House election to one for an election for the House at the same time as the Half Senate election. This could be as late as the end of May or the beginning of June.

Mr Fraser said that he was calling as a matter of courtesy to tell me this, but that he wished to make a public statement and having regard to the fact that he had had earlier conversations with me did not wish to make it without telling me in advance. He had no objections to me mentioning his intention of making a statement to the Prime Minister but said he proposed to issue his statement as soon as his talk with me was concluded.

I saw the Prime Minister half an hour later at a pre-Melbourne Cup Reception at Government House, Victoria and told him what Mr Fraser had said. He indicated that he had already heard the substance of the press statement but that he would have nothing whatsoever to do with any election for the House of Representatives. He said that he would never recommend an election for the House of Representatives until he himself was ready to do so and certainly would not do it at the behest of Mr Fraser or the Senate. He later said that the only way in which an election for the House could occur would be if I dismissed him.

I have had conversations today with Mr Fraser, the Prime Minister, the Attorney-General, and the Treasurer. I have done this simply to keep up to date with what is happening and have done so with the approval of the Prime Minister.

As to Mr Fraser, he indicated that he regarded the position as being so serious that the Senate would go on deferring Supply indefinitely and that his Party would hold together for this purpose. This was a factual statement in which he merely repeated to me what he was saying publicly, but I judge that he meant it.

As to the Prime Minister, his position remains the same though he is obviously in two minds about whether he will recommend a Half Senate election early or late.

I will not summarise or repeat the various problems associated with the attitudes of the Premiers and their Governors to such a Half Senate election. The Prime Minister does not seem to care whether the Premiers co-operate at this stage or not. In any event he has not yet made up his mind.

As to the Treasurer, he has told me exactly what the Government proposes to do to try to carry on without Supply. In effect the scheme is to issue certificates of indebtedness to public servants, members of the defence forces, suppliers of and contractors to the Government. It is hoped that the banks will accept these as security for advances of the amount covered by the certificates taking assignments of the certificates by way of mortgage. The interest on the advances would have to be met in due course by the Commonwealth and this payment would ultimately require legislation.

Discussions were taking place this morning between Treasury officials and the banks, the outcome of which at this moment I do not know. The Prime Minister was confident that they would co-operate. Mr Fraser seems to have considerable doubt about this. In any event the scheme would be messy as the Government itself admits and would by no means cover all matters covered by the Appropriation Bills.

The Attorney-General has explained to me the reasons why the Government is of the opinion that this scheme would be legal to the extent that it operated, that it would not be unconstitutional and would otherwise be within the law. There is every prospect that it will be challenged by someone in the High Court and I would assume that the Chief Justice would do his best to have an urgent hearing of the matter.

I do not see any point, unless you are interested, in outlining the complicated legal story involved in the Government's scheme, certainly not at the present time, if there is prospect of the matter being clarified by litigation. Whether it is so clarified or not, it obviously is an unsatisfactory way of carrying on Government both because of what has been described as its messy elements and because it does not cover all of the requirements of the Government under existing legislative provisions which need to be supported by Appropriation Acts including the health scheme "Medibank".

The crisis is now a very serious one and if both parties and their leaders remain adamant, an important decision one way or the other may have to be made by me this month. I may say that Public Servants and others, with some exceptions, will probably be able to be paid until the last pay period in November but there will not be Supply, unless the scheme with the banks works, for the first pay in December, namely the 11th December.

Please assure Her Majesty of my continued loyalty and humble duty.

Yours sincerely,

SIGNED: John R Kerr

Lieutenant Colonel the Right Honourable Sir Martin Charteris, K.C.B., K.C.V.O., O.B.E.,
Private Secretary to The Queen,
Buckingham Palace,
LONDON ENGLAND